Oil prices edged lower Friday as traders looked past the latest military exchanges between the United States and Iran and focused on the prospect of improving energy shipments through the Strait of Hormuz. Despite the daily decline, both major crude benchmarks posted solid gains for the week.
Brent crude settled at $76.01 per barrel, down $0.29 (0.38%), while West Texas Intermediate (WTI) closed at $71.41 per barrel, down $0.67 (0.93%). For the week, Brent gained approximately 5.5%, while WTI advanced nearly 4.0%.
Market sentiment improved on expectations that diplomatic negotiations could resume and eventually lead to a broader reduction in regional tensions. While shipping through the Strait of Hormuz remains below normal levels following recent disruptions, traders increasingly expect traffic to recover over time, helping to ease concerns over prolonged supply shortages.
The recent conflict has delayed the full reopening of the strategic waterway, which prior to the war carried roughly one-fifth of the world’s oil and liquefied natural gas shipments. Although vessel traffic has gradually resumed, overall shipping activity remains below pre-conflict levels.
Markets also took some comfort from the absence of attacks targeting major energy infrastructure, reducing fears of a significant interruption to global crude supplies. However, ongoing geopolitical uncertainty continues to support a modest risk premium in oil prices as negotiations remain fragile.
Elsewhere, continued disruptions to Russian energy infrastructure have reduced fuel production, adding another source of uncertainty to global petroleum markets even as expectations for improving Middle Eastern exports help offset broader supply concerns.